A Michigan judge ruled today that Detroit filing for chapter 9 bankruptcy on Thursday was unconstitutional. Ingham County Circuit Judge Rosemarie Aquilina said the filing must be withdrawn and that, according to the Detroit Free Press, the governor and city emergency manager “must take no further actions that threaten to diminish the pension benefits of City of Detroit retirees.”

The reduction in those particular benefits is at issue here, due to a portion of the Michigan Constitution that reads [PDF]:

“The accrued financial benefits of each pension plan and retirement system of the state and its political subdivisions shall be a contractual obligation thereof which shall not be diminished or impaired thereby.”

The judge interpreted this passage to declare the bankruptcy filing unconstitutional, though this piece in the Detroit News argues that it may not be that clear-cut.

Meanwhile, Attorney General Bill Schuette is appealing the decision to the Michigan Court of Appeals and requesting the orders stayed for the time being.

Under normal circumstances, what you have accrued means what you have accrued to date. Some judge a long time ago in CA deemed that to mean whatever your contract said you WILL accrue and that is what the unions there base their claims on.
They all need to go to a defined contribution plan, but the unions would rather bankrupt the country first.

No. The hack judge expects U.S. taxpayers to bailout bankrupt cities.
Never mind the fact that decades and decades of liberal policies and
Union Thugs have reduced this once active city to a current cesspool
city. She wants U.S. taxpayers to foot the bill.

I agree. The “dishonor Obama” comment, if true, is ridiculous beyond belief and indicative of a stupid judge. Nevertheless, the provision in the State Constitution does present an interesting legal issue. It seems to me a State should have the right to protect pensions like this, regardless of the sanity of the provision. It’s a State and its political subdivisions and they should have the right to determine such matters, but I do think it will be overturned via Federal pre emption.

And what about taxpayers rights? The unions get the officials elected who in turn approve these benefits that cannot ever be paid under the assumption that the taxpayers will pay or else.
Time for taxpayer revolt!

So the State has a right to enslave the few tax paying citizens left to pay for the bloated pensions of public employees because the political officials that agreed to the pensions were bought and paid for by the public employee unions?

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